Smart Phone Apps are Altering How Consumers Comparison Shop

This holiday shopping season has been very different from years past, and not just because the final same-store sales figures will be crucial in indicating if the nascent economic recovery has real legs. This season has also been marked by consumers hunting for deals in new ways by using cell phones and other mobile devices to shop online while at the mall.

For example, by snapping a picture of scanning a barcode, consumers can comparison shop on the go, meaning that they may see a product they want to buy in one store, but instead purchase it online, or drive to another store where the same item is less expensive. In addition, other applications for iPhones and the Android operating system enable shoppers to receive promotions on the go and search malls virtually while walking them physically.

In the next few pages, Site Optimizer profiles a handful of these new applications and how shoppers are using them.

Several applications including ShopSavvy, RedLaser and Amazon Remembers, allow shoppers to scan product barcodes or photograph productions and find out what other brick-and-mortar retailers nearby as well as online retailers are charging for the same item.

Meanwhile, Point Inside makes it easier to navigate malls by providing map and directory access to more than 400 properties in North America and more than 100,000 stores and services like elevators and ATMs. Lastly, NearbyNow allows iPhone users to look through 20 popular gift giving guides and generates lists of stores near the user that might be carrying those products.

Next page: Scanning While Shopping

Scanning While Shopping

In 2008, a Dallas-based mobile application developer Big in Japan debuted ShopSavvy. The application enables shoppers to scan barcodes and then, using GPS technology, generates a list of nearby and online retailers carrying the same product so consumers can find the lowest price instantly.

Big in Japan has versions of the application that work on both Android phones and iPhones. Next year, it will also be available on Windows Mobile, Blackberry and Palm Pre devices.

More than 20,000 retailers provide data to the application. This holiday shopping season, ShopSavvy has registered 4 million scans a day from consumers—about a six-fold increase from its normal daily usage that ranges from 600,000 to one million scans, according to Alexander Muse, co-founder of Big in Japan. About 50 percent of those scans are for consumer electronics, another 25 percent are for DVDs, books and video games and the rest are for health and beauty, apparel, grocery and other items.

Adam Moss, an iPhone owner based in Overland Park, Kan., says he always uses ShopSavvy when making big ticket purchases. The application doesn’t only help him get a better deal, sometimes without leaving the store—retailers are often willing to match competitors’ prices if the shopper brings up the disparity—but allows him to gauge the quality of the product. “Amazon has a lot of customer reviews, so that’s helpful,” he notes. The only drawback to ShopSavvy is that scanning the barcode takes time and patience—you have to stand very still while taking the picture and in an informal office experiment, it took several minutes for an iPhone to finally register the code on various electronic items.

Meanwhile, participating retailers get an opportunity to lure in shoppers with their sales and can purchase up to 15 different add-on services from Big in Japan (a listing with ShopSavvy is free of charge). For instance, retailers can buy data on how many scans were performed on a particular product at a competitors’ stores, or make sure that the application allows them to offer the lowest price on a given item, says Muse. Today’s shoppers “have smart phones and they use the Internet,” he notes. “Now you can use this technology to your advantage, instead of being a victim of it.”

ShopSavvy is not the only application of this kind. There’s also Red Laser, a barcode scanning application released this May by Occipital LLC, a Boulder, Colo.-based technology firm. Red Laser, which costs $1.99, works with iPhones to search for online product prices through Google and The Find, a product search engine. Occipital claims Red Laser’s barcode scanning system compensates for out-of-focus images, which means that it can be used on mobile devices that don’t have autofocus.

To keep up, Amazon.com has come up with Amazon Remembers, an application that works on iPhones and iPod Touch devices to allow shoppers to take photos of the products they want in the store and search for better sales online. Amazon keeps the photo on the shoppers’ Amazon List and sends an email notification if it finds the item on sale.

Next page: Navigating the Mall

Navigating the Mall

There are also new applications available for shoppers who’d like to have an easier time navigating retail properties. For example, Point Inside Inc., a Seattle-based indoor mapping developer, just launched a new mapping application for malls.

The Point Inside application is free and works with iPhones and iPod Touch devices. It allows users map and directory access to more than 400 malls in North America and more than 100,000 stores and services like elevators and ATMs. (One of the most frequent search queries is for rest rooms, says Kevin Foreman, CEO of Point Inside Inc.)

The application helps keep mall information up-to-date by letting mall owners and store operators enter layout changes through the back portal. They can also list up-to-the-minute events and sales promotions. Meanwhile, shoppers get access to store hours and phone numbers, as well as Web site links.

“We know where you are located, so we can say you are right next to XYZ mall,” says Foreman. “And then all you have to do is click on the mall and say ‘Show me the events that are going on.’ So there might be a Santa Clause at the mall and the application will tell you what his hours are. There is also a promotion list. And you can find the restrooms. It’s a mall directory on steroids.”

Foreman claims that Point Inside is already one of the top 50 navigation applications downloaded from the Apple Store.

Meanwhile, MEDL Mobile, a Los Angeles-based tech firm, recently helped launched Mall Maps, an application developed by Shayne Faerber, of Naples, Fla. The iPhone application helps shoppers access a directory of malls and shopping centers across the U.S., including store listings and floor layouts. Users can use the application’s GPS system to ask for a directory of retail properties in their direct vicinity or search for centers using city, state and zip code data. Mall Maps was developed for shoppers who may be far away from home and unsure of what retail centers might be in the area.

Another application that can aid shoppers at malls comes from Mountain View, Calif-based NearbyNow. The firm has developed an application that allows iPhone users to look through 20 of the most popular gift giving guides for the holiday season. The guides include those put together by retailers (Macy’s, Nordstrom, Lord & Taylor etc.) and consumer magazines like In Style and Cosmopolitan.

The application gives shoppers the option of browsing through individual guides or filling out a short form about the gift they are shopping for—for example, an item under $50 for a woman who loves the outdoors. NearbyNow then presents a list of products that fit this description and the shopper can choose to buy the item right away by clicking through to the retailer’s website, share the find with friends on Facebook or through email or ask NearbyNow for a list of local stores that might carry the product.

By filling out NearbyNow’s concierge service form, they can then make sure the store puts the item on hold until they come and pick it up. In what turned out to be a surprise for the application’s developers, the conversion rate for finding the product at nearby stores is approximately 5.5 percent, vs. only 0.45 percent for buying the item online.

“It seems to be particularly the case for apparel, shoes and jewelry,” says Scott Dunlap, NearbyNow CEO. “We are quite excited about it.”

NearbyNow is currently free, but the firm might start charging a fee after re-focusing the application toward the next gift season in mid-January.